12/30/2005 @ 6:00AM

Daniel Lyons On IT

Open source software programs will continue to change the rules of the information technology game. Traditional closed source vendors like
IBM
,
Microsoft
and
Oracle
need to develop new strategies for coping with open source upstarts like JBoss, Linux and MySQL, respectively. But the impact goes beyond software companies. Hardware companies will continue using free programs like Linux to create new devices at much lower price points. Big corporate users will drive down their costs by displacing expensive programs with open source alternatives.

The Unconventional Wisdom

Dell
will start selling computers that use
AMD
microprocessors. The advantages in cost and performance will prove too strong to ignore. Meanwhile, Linux distributors like
Red Hat
and
Novell
will concede that Linux does in fact infringe on patents held by others, including Microsoft; and they will enter negotiations with the Evil Empire.

The Misplaced Assumption

That Linux on the desktop will take over the world. In fact, it will remain a fantasy for most users. Yes, Windows is a massive pain in the neck. And, yes, you can get Linux and Open Office for free. But for whatever reason, most customers will continue paying for Windows, or switch to
Apple Computer
‘s
Mac OS.

The Watch List

– Ray Ozzie: The creator of Lotus Notes now is charged with breathing new life into Microsoft. I think he can do it.

– Richard Stallman and Eben Moglen of the Free Software Foundation: They are about to introduce a new version of the GNU General Public License (GPL), under which Linux and many other free programs are distributed. Stallman and Moglen are inviting people from the open source community to comment on the license changes. The process will be messy, entertaining–and may determine whether Linux continues to gain momentum among corporate customers.

The Bold Prediction

Google
shares, now at more than $400, will drop 50% plus by the end of 2006.